Correlation Between Home Bancorp and Bank of South
Can any of the company-specific risk be diversified away by investing in both Home Bancorp and Bank of South at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Home Bancorp and Bank of South into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Home Bancorp and Bank of South, you can compare the effects of market volatilities on Home Bancorp and Bank of South and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Home Bancorp with a short position of Bank of South. Check out your portfolio center. Please also check ongoing floating volatility patterns of Home Bancorp and Bank of South.
Diversification Opportunities for Home Bancorp and Bank of South
0.0 | Correlation Coefficient |
Pay attention - limited upside
The 3 months correlation between Home and Bank is 0.0. Overlapping area represents the amount of risk that can be diversified away by holding Home Bancorp and Bank of South in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bank of South and Home Bancorp is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Home Bancorp are associated (or correlated) with Bank of South. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bank of South has no effect on the direction of Home Bancorp i.e., Home Bancorp and Bank of South go up and down completely randomly.
Pair Corralation between Home Bancorp and Bank of South
If you would invest 4,432 in Home Bancorp on November 9, 2024 and sell it today you would earn a total of 817.00 from holding Home Bancorp or generate 18.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Flat |
| Strength | Insignificant |
| Accuracy | 0.0% |
| Values | Daily Returns |
Home Bancorp vs. Bank of South
Performance |
| Timeline |
| Home Bancorp |
| Bank of South |
Risk-Adjusted Performance
Very Weak
Weak | Strong |
Home Bancorp and Bank of South Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Home Bancorp and Bank of South
The main advantage of trading using opposite Home Bancorp and Bank of South positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Home Bancorp position performs unexpectedly, Bank of South can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Bank of South will offset losses from the drop in Bank of South's long position.| Home Bancorp vs. Home Federal Bancorp | Home Bancorp vs. Community West Bancshares | Home Bancorp vs. First Financial Northwest | Home Bancorp vs. First Capital |
| Bank of South vs. Auburn National Bancorporation | Bank of South vs. Bank of Marin | Bank of South vs. Ames National | Bank of South vs. CF Financial |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Fundamentals Comparison module to compare fundamentals across multiple equities to find investing opportunities.
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